Summary of FERC Meeting Agenda for July 2022

Alert
|
21 min read

Below are summaries of the agenda items for the Federal Energy Regulatory Commission’s July 28, 2022 open meeting, pursuant to the sunshine notice released on July 21, 2022.

In this issue…

  • Electric Items
  • Miscellaneous Items
  • Gas Items
  • Hydro Items
  • Certificate Items

 

Electric

E-1 – Credit-Related Information Sharing in Organized Wholesale Electric Markets (Docket No. RM22-13-000). Public information about this docket is not yet available. Agenda item E-1 may be a new Notice of Proposed Rulemaking (NOPR) regarding credit-related information sharing in organized wholesale electric markets.

E-2 – California Independent System Operator Corporation, ISO New England Inc., New York Independent System Operator, Inc., Southwest Power Pool Inc. (Docket Nos. EL22-62-000, EL22-63-000, EL22-64-000 & EL22-65-000). Public information about the above-referenced dockets are not yet available.

E-3 – Accounting and Reporting Treatment of Certain Renewable Energy Assets (Docket No. RM21-11-000). On January 19, 2021, the Commission issued a Notice of Inquiry (NOI) regarding Accounting and Reporting Treatment of Certain Renewable Energy Assets. Specifically, in the NOI, the Commission sought comment on the following: (1) whether to create new accounts within the Uniform System of Accounts (USofA) for non-hydro renewable energy generating assets and, if so, how such accounts should be organized; (2) how to modify FERC Form No. 1 to reflect any new accounts; (3) whether to codify the proper accounting treatment of the purchase, generation, and use of renewable energy credits; and (4) comments on the rate setting implications of these potential accounting and reporting changes. Several entities and organizations submitted comments in response to the Commission’s NOI. Agenda item E-3 may be an order relating to the NOI.  

E-4 – PJM Interconnection, L.L.C. (Docket Nos. EL19-58-007, ER19-1486-004). On December 22, 2021, the Commission issued an order on voluntary remand (Order on Remand) concerning PJM Interconnection, L.L.C.’s (PJM) operating reserve demand curves. The Order on Remand followed a May 2020 order in which the Commission concluded that PJM’s existing reserve market design, including the vertical operating reserve demand curves, was unjust and unreasonable. In the Order on Remand, the Commission changed course once again. Several parties have filed requests for rehearing of the Order on Remand. Agenda item E-4 may be an order relating to the requests for rehearing of the Order on Remand.

E-5 – Midway Sunset Cogeneration Company (Docket No. ER21-998-002). On January 29, 2021 Midway Sunset Cogeneration Company  (Midway), pursuant to section 205 of the Federal Power Act (FPA), filed an unexecuted Reliability Must-Run Service Agreement (RMR Agreement) with the California Independent System Operator (CAISO) for its 248 MW natural-gas-fired cogeneration facility located in Kern County, California (the Facility). Southern California Edison Company (SCE), San Diego Gas & Electric Company (SDG&E), Pacific Gas and Electric Company (PG&E), CAISO, and the California Public Utilities Commission (CPUC) filed interventions. On April 2, 2021, the Commission accepted the RMR Agreement, suspended it for a nominal period, to become effective February 1, 2021, subject to refund, and established hearing and settlement judge procedures. On April 29, 2022, Midway filed an Offer of Settlement. On May 19, 2022, Trial Staff filed their initial comments in support of the April 29, 2022 Offer of Settlement. On June 7, 2022, the Chief Judge Certified the Uncontested Offer of Settlement and subsequently terminated the Settlement Judge Procedures on June 15, 2022. Agenda item E-5 may be an order on Midway’s Offer of Settlement. 

E-6 – Form 580 - Interrogatory on Fuel and Energy Purchase Practices and Sierra Pacific Power Company (Docket No. IN79-6-000). On June 7, 2022, Sierra Pacific Power Company (Sierra Pacific) filed a Request for Partial Waiver of the FERC Form 580 Filing Requirements for questions 3 through 8 arguing that the fuel procurement addressed by those questions is so de minimis that the pass-through could not reasonably be found to influence Sierra Pacific’s diligence in procuring energy and fuel supplies and reasonable rate. FERC took Notice of the Request for Partial Waiver on June 7, 2022. Agenda item E-6 may be an order on Sierra Pacific’s Request for Partial Waiver.

E-7 – Northern Maine Independent System Administrator, Inc. v. ISO New England Participating Transmission Owners Administrative Committee (Docket No. EL22-31-000). On February 14, 2022, the Northern Maine Independent System Administrator, Inc. (NMISA) filed a complaint against the New England Participating Transmission Owners arguing they failed to submit a request to NMISA to make a joint filing with the Commission under Section 205 of the FPA to amend the ISO New England Inc. (ISO-NE) Open Access Transmission Tariff  (OATT) in a manner resulting in the permanent elimination of the Through or Out Service rate for transactions originating in the New England Control Area for eventual delivery to NMISA. NMISA argued it should be afforded the same reciprocal discount provided for point-to-point transactions with ISO-NE as currently exits with ISO-NE and the New York Control Area. On March 7, 2022, the Participating Transmission Owners Administrative Committee filed an Answer to NMISA’s Complaint. The Participating Transmission Owners Committee stated that in its consideration of the proposal when it was first raised by NMISA, the Committee determined there are relevant differences between the New York and Northern Maine control areas and could not find sufficient data to all the Committee to make such a proposal. On March 16, 2022, NMISA Filed a Motion for Leave to Response and Response, arguing that the Participation Transmission Owners Administrative Committee have not provided sufficient justification for why NMISA has not be offered reciprocity comparable that which is afforded in NYISO for almost two decades. Agenda item E-7 may be an order on NMISA’s Complaint.

 

Miscellaneous

M-1 – Duty of Candor (Docket No. RM22-20-000). The record in Docket No. RM22-20-000 has not yet been populated or initiated in eLibrary. Based on the title, agenda item M-1 appears to be the issuance of a Notice of Proposed Rulemaking (NOPR) with respect to the Duty of Candor obligation.

 

Gas

G-1 – MPLX Ozark Pipe Line LLC (Docket No. OR19-14-000). On December 26, 2018, MPLX Ozark Pipe Line LLC (MPLX Ozark) submitted an application for authorization to charge market-based rates (MBR), pursuant to Part 348 of the Rules of Practice and Procedure of the Commission. In the application, MPLX Ozark requested MBR authority for: 1) the transportation of all crude oil from its origin market located in the state of Oklahoma; and 2) the transportation of all crude oil to its destination market comprised of counties located in the states of Missouri and Illinois. Multiple parties filed motions to intervene and substantive protests contesting the MBR request, including Phillips 66 Company and Husky Marketing & Supply Company (collectively, Intervenors). As current and future shippers on the MPLX Ozark system, Intervenors alleged that the application uses an overly broad product and destination market, and as a result, should be rejected. On June 25, 2019, the Commission issued an order, granting MBR authority in the origin market and setting the matter of MBR authority in the destination market for hearing and designating a chief judge to preside over the proceeding. On August 16, 2019, the chief judge issued a final report, stating that the participants conveyed that achieving a settlement is unlikely and, therefore, settlement conferences and related discussions should be discontinued; on August 19, 2019, the settlement procedures were terminated. Following a period of filed testimony and subpoenas between MPLX Ozark and Intervenors, the Commission instituted renewed settlement procedures on March 18, 2020, citing the closure of Commission offices due to the pandemic and the need to resolve this labor-intensive matter. On May 15, 2020, following the submission of prehearing briefs, the Commission convened a settlement conference between the parties. On June 29, 2020 and June 30, 2020, respectively, the parties filed Initial Briefs; subsequently, the parties filed Reply Briefs on July 29, 2020. The chief judge issued a final report on August 13, 2020, stating that once again the participants asserted that a settlement was unlikely and that settlement judge procedures should be discontinued; on August 17, 2020, the settlement procedures were terminated. On September 25, 2020, the administrative law judge (ALJ) issued the Initial Decision for the proceeding, finding that the MBR authority for the destination market should be denied, as MPLX Ozark did not sufficiently demonstrate that it is unable to exercise market power in the defined geographic market in Missouri and Illinois. Following the Initial Decision rendered by the ALJ, each of the parties filed respective briefs on exceptions on October 26, 2020, as well as briefs opposing exceptions on November 16, 2020. Agenda item G-1 may be an order resolving the outstanding material matter set forth in settlement judge procedures, namely the application for MBR authority in the MPLX Ozark system destination market.

 

Hydro

H-1 – Village of Gouverneur, New York (Docket No. P-14635-001). On September 20, 2019, Village of Gouverneur, New York (Gouverneur) submitted a final application for license of a minor hydroelectric project, Project No. 14635, in accordance with the process requirements determined under the Traditional Licensing Process governed by the Commission. On November 19, 2020, the Commission issued a notice soliciting comments, recommendations, terms and conditions, and prescriptions in advance of preparing the Environmental Assessment (EA) for the Project. On September 8, 2021, the Commission issued the EA, finding that approval of the Project, with staff-recommended alternative measures implemented as furnished in the EA, would not constitute a major federal action significantly affecting the quality of the human environment. On January 19, 2022, the New York State Department of Environmental Conservation submitted the certification pursuant to Section 401 of the Clean Water Act. Agenda item H-1 may be an order relating to the final application as brought forward by Gouverneur.

H-2 – Pacific Gas and Electric Company (Docket No. P-77-312). On April 21, 2022, the Commission issued the Annual License to Pacific Gas and Electric Company (PG&E) in order to continue operation of the Potter Valley Hydroelectric Project, Project No. 77-298. On May 20, 2022, Friends of the Eel River, Pacific Coast Federation of Fishermen’s Associations, Institute for Fisheries Resources, Trout Unlimited, and California Trout (collectively Petitioners) filed a request for rehearing of the April 21 issuance, asserting that the annual license contravened provisions of the Endangered Species Act (ESA). In particular, Petitioners alleged that the Commission violated Section 7(a)(1) of the ESA by failing to ensure that operation of the Project is consistent with the conservation of a species of salmon and trout. Petitioners also raised that the Commission, in granting the Annual License, violated Section 7(a)(2) of the ESA by failing to engage the National Marine Fisheries Service for consultation in the matter. Agenda item H-2 may be an order on the request for rehearing as brought forward by Petitioners.

 

Certificates

C-1 – EcoEléctrica, L.P. (Docket No. CP95-35-002). After Puerto Rico experienced several earthquakes in late December 2019 and early January 2020, the Commission issued an order (Remedial Order) on March 26, 2020 restricting the operations of EcoEléctrica, L.P.'s (EcoEléctrica) liquefied natural gas (LNG) terminal located at Guayanilla Bay in Peñuelas, Puerto Rico. The Remedial Order required EcoEléctrica to conduct a structural analysis of the LNG storage tank for review and approval. The Remedial Order also required that EcoEléctrica receive written authorization before increasing the storage tank's liquid level above 63 feet. Since then, Commission staff has advised EcoEléctrica on the type and scope of information needed to fulfill the Remedial Order's requirements. On May 19, 2021, EcoEléctrica filed a request for approval to increase the LNG storage tank's liquid level to 91 feet and included a structural analysis of the storage tank's inner and outer metal tanks to support its request. On September 24, 2021, the Commission issued a Briefing Order, finding that EcoEléctrica's structural analysis was inadequate to support authorizing the requested change in operations and withholding action on EcoEléctrica's request until a more complete record is developed. The Commission also found that EcoEléctrica had not fully demonstrated the reliability impacts associated with a temporary withholding of approval to increase the liquid storage level above 63 feet. The Briefing Order established a schedule for briefs addressing whether EcoEléctrica can safely operate its LNG storage tank at a liquid level higher than 63 feet. On October 25, 2021, EcoEléctrica requested that the Commission extend the deadline to file initial briefs from November 8, 2021 to May 31, 2022, and the deadline to file reply briefs from November 22, 2021 to June 14, 2022. On December 2, 2021, the Commission issued an Order Partially Granting Request for an Extension of Time, in which the Commission extended the deadline to file initial briefs to February 8, 2022 and the deadline to file reply briefs to February 22, 2022. The Commission explained that while it accepted EcoEléctrica's assertion that it was unable to complete the required analyses by the initial deadline, it could not delay until the deadlines requested by EcoEléctrica in light of foreseeable seismic activity similar to that which necessitated the Remedial Order as well as the Commission's need to receive the requested information prior to the next hurricane season in order to determine at what liquid level EcoEléctrica can safely operate its LNG storage tank and to determine what reliability impacts to Puerto Rico's electric grid could result from whatever liquid storage level is ultimately authorized. EcoEléctrica filed its initial brief on February 8, 2022 and no parties filed reply briefs. On April 22, 2022, the Commission issued an order on initial brief, reaffirming that prior to increasing the LNG storage tank to a liquid level high than 63 feet, EcoEléctrica must receive written authorization from the Commission. On May 23, 2022, EcoEléctrica filed a request for clarification of the April 22 order, principally to reiterate the prior request that the Commission convene a technical conference to enable EcoEléctrica to engage with Commission engineering staff regarding the technical modeling sought by the Commission for the further review and approval process. Agenda item C-1 may be an order on the request for clarification as brought forward by EcoEléctrica.

C-2 – Freeport LNG Development, L.P., FLNG Liquefaction, LLC, FLNG Liquefaction 2, LLC, and FLNG Liquefaction 3, LLC (Docket No. CP21-470-000). On June 29, 2021, Freeport LNG Development, L.P., FLNG Liquefaction, LLC, FLNG Liquefaction 2, LLC, and FLNG Liquefaction 3, LLC (collectively, Freeport LNG) submitted an application, pursuant to Section 3(a) of the Natural Gas Act (NGA), for a limited amendment to the prior authorizations granted by the Commission related to the Freeport LNG Liquefaction Project located in Texas. In the amendment application, Freeport LNG seeks an increase to the maximum LNG production capacity resulting in an approximate 32 percent increase in volume, consistent with the highest production scenario previously reviewed by Commission staff in the earlier authorization proceedings. On August 4, 2021, Sierra Club filed a protest, alleging that the proposed production increase may generate material impacts to the environment and therefore additional review under the NGA is necessary prior to review and approval. In the ensuing months, Commission staff and Freeport LNG exchanged data requests and supplemental information, generally pertaining to the potential environmental impacts of the additional production. On May 12, 2022, the Commission issued the Environmental Assessment, finding that the LNG capacity amendment project would not constitute a major federal action significantly affecting the quality of the human environment. Agenda item C-2 may be an order on the limited amendment application as brought forward by Freeport LNG.

C-3 – ANR Pipeline Company (Docket No. CP20-484-000). On June 20, 2020, ANR Pipeline Company (ANR) filed an application requesting Commission authorization to construct and operate the Alberta XPress Project (Project). The Project consists of the construction and operation of a new compressor station in Evangeline Parish, Louisiana to provide up to 165,000 dekatherms per day (Dth/d) of additional firm transportation service on ANR’s Southeast Mainline. ANR also requested authorization to acquire by lease capacity on Great Lakes Gas Transmission Limited Partnership’s (Great Lakes) transmission system to provide 155,407 Dth/d of firm transportation service. On June 22, 2020, Great Lakes filed an application requesting authorization to abandon such capacity by lease to ANR. On April 21, 2022, the Commission issued an order (Order) granting the certificate and abandonment authorizations requested by ANR and Great Lakes, and approved the rates proposed by ANR. The Order found that ANR’s proposal will not result in subsidization of the Project by ANR’s existing shippers, but also ordered that, with regard to ANR providing service on the Project at a discount and the potential future impact thereof on shippers, ANR will be fully at risk for any revenue shortfalls related to the Project. On May 2, 2022, ANR accepted the certificate granted in such Order, but noted that its acceptance was subject to the outcome of any rehearing request that may be filed. On May 20, 2022, ANR submitted a request for rehearing of the Order (Rehearing Request). In its Rehearing Request, ANR argued that the Commission erred in order that, with regard to ANR providing service on the Project, ANR will be fully at risk for any revenue shortfalls related to the Project. ANR asserted that such “at risk” condition is inappropriate under the Commission’s Certificate Policy Statement given the Commission’s finding that ANR’s existing shippers will not subsidize the Project. ANR alleged that the Commission departed from its own policy, without explanation, by nevertheless applying its prior policy in ordering that ANR will be “at risk” for revenue shortfalls. ANR clarified that while it is seeking rehearing of the proper treatment of rates associated with Project service, it does not otherwise oppose the construction, operation or need of the Project. Agenda item C-3 may be an order on the Rehearing Request.

C-4 – Gas Transmission Northwest, LLC (Docket No. CP21-29-000). On January 13, 2021, Gas Transmission Northwest, LLC (GTN) filed a prior notice request with the Commission, notifying the Commission of its intent to install and operate a greenfield 1,586 horsepower compressor station in Morrow County, Oregon, known as the Coyote Springs Compression Project (Project). GTN proposed to install the Project facilities under authorities granted by its blanket certificate issued in Docket No. CP82-540-000, et al. On March 15, 2021, the Commission issued an environmental assessment (EA) for the Project. On March 22, 2021, Columbia Riverkeeper filed a timely protest to GTN’s prior notice request, seeking to have GTN’s prior notice request processed as a separate application rather than pursuant to GTN’s blanket certificate. Columbia Riverkeeper asserted such treatment is appropriate because, according to Columbia Riverkeeper, the Project is part of GTN’s planned GTN XPress expansion project, and therefore does not qualify as one of the routine activities GTN is permitted to carry out pursuant to its blanket certificate. The Commission subsequently determined that the Project may result in effects to National Register of Historic Places-eligible properties, which would not satisfy the blanket certificate standard conditions. GTN’s prior notice was therefore converted to a case-specific Natural Gas Act section 7(c) application (Application). On March 4, 2022, the Commission issued a supplemental EA for the Project in order to supplement its environmental review in light of such conversion. Agenda item C-4 may be an order on the Application. 

C-5 – Nopetro LNG, LLC (Docket No. CP21-179-001). On April 20, 2021, Nopetro LNG, LLC (Nopetro) filed a petition (Petition) requesting that the Commission declare that Nopetro’s construction and operation of a natural gas liquefaction and truck loading facility and proposed transloading operations in Port St. Joe, Florida (collectively, the Nopetro Facility) would not be subject to the Commission’s jurisdiction under section 3 or 7 of the Natural Gas Act (NGA). On March 25, 2022, the Commission issued an order (Order) granting Nopetro’s Petition. The Commission found that the Nopetro Facility is not an LNG terminal subject to its jurisdiction under NGA section 3 because it is not located at the point of export such that LNG can be directly transferred to vessels for export. The Commission explained that it lacked such jurisdiction over the Nopetro Facility because the LNG-filled ISO containers would leave the Nopetro Facility and be transported by truck approximately a quarter of a mile to a dock that would remain available for general public use, where the containers would then be loaded onto ocean-going vessels by a crane that, while owned by Nopetro, would be available for use by others through the dock operator for a fee. The Commission rejected intervenors’ argument that the Nopetro Facility is a jurisdictional LNG facility because it is only a quarter of a mile away from the export point and is therefore effectively transferring LNG directly to an ocean-going LNG tanker, instead finding that the Nopetro Facility is neither onshore nor in state waters, as would be required under section 2(11) of the NGA for the Commission to exercise jurisdiction over the Nopetro Facility. The Commission also rejected intervenors’ arguments that its prior decisions examining its jurisdiction over compressed natural gas (CNG) facilities is irrelevant to its analysis of an LNG facility such as the Nopetro Facility, finding instead that with the singular exception of exporting LNG rather than CNG, the Nopetro Facility is essentially identical to such facilities and therefore its prior decisions involving such CNG facilities is relevant to its jurisdictional analysis of the Nopetro Facility. The Commission further determined that it could not assert jurisdiction over the Nopetro Facility pursuant to NGA section 7 because that statutory provision only applies to the transportation of natural gas via pipeline. The Commission also rejected concerns about the creation of a potential regulatory gap if it did not exercise jurisdiction over the Nopetro Facility, explaining that the “need for regulation cannot alone create authority to regulate.” On April 22, 2022, Public Citizen, Inc. (Public Citizen) filed a request for rehearing of the Order (Rehearing Request). In its Rehearing Request, Public Citizen asserted that the Commission committed two errors in the Order. Public Citizen argued that the Commission first erred in declining to exercise jurisdiction over the Nopetro Facility because, according to Public Citizen, the plain language of the NGA, its legislative history, and the Commission’s three-pronged test all provide the Commission no discretion to decline oversight of the Nopetro Facility. Public Citizen next alleged that the Commission’s erred a second time in ruling that “onshore” as used in the NGA is limited to a facility physically on the shoreline. According to Public Citizen, such ruling is contrary to plain meaning of the statutory language in the NGA, inconsistent with the NGA’s structure and purpose, and patently unreasonable. Public Citizen contended that the Nopetro Facility is unambiguously an onshore LNG terminal subject to the Commission’s exclusive jurisdiction because it will perform multiple functions that are all listed in the NGA’s definition of “LNG terminal” and is located on land. Agenda item C-5 may be an order on the Rehearing Request.

C-6 – Golden Pass LNG Terminal LLC (Docket No. CP14-517-001). On February 25, 2021, Golden Pass LNG Terminal LLC and Golden Pass Pipeline LLC (collectively, Golden Pass) filed a variance request (Variance Request Number 15) for the Golden Pass LNG Export Project (Project). In its Variance Request Number 15, Golden Pass specifically requested an amendment to its authorization for the Project – which authorization was issued by the Commission on December 21, 2016 (Order) – based on Golden Pass’s subsequent identification of a need for traffic volumes, workforce numbers, and work week/hour limits in excess of was previously authorized in the Order. On March 22 2022, the Commission issued an environmental assessment (EA) for the Variance Request Number 15, in which the Commission determined that approval of the Variance Request Number 15 will not constitute a major federal action significantly affecting the quality of the environment, so long as Golden Pass constructs the facilities in accordance with its Variance Request Number 15 and Commission staff’s mitigation measures set forth in the EA. Agenda item C-6 may be an order on the Variance Request Number 15.

 

 

This publication is provided for your convenience and does not constitute legal advice. This publication is protected by copyright.
© 2022 White & Case LLP

 

Top